AI Drafter 
TaxTMI 
TaxTMI 
2013 (4) TMI 886
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....68 of the Income-tax Act, 1961. 4. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in confirming the addition made by the AO of an amount of Rs. 9,80,015/- on account of loans allegedly taken from Finishing Touch during the year, u/s. 68 of the Income-tax Act, 1961. 5. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in not disposing of the ground No.3 before him pertaining to addition of Rs. 34,249 out of labour charges. 6. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in not disposing of the ground No.4 before him pertaining to addition of Rs. 3,858 out of telephone charges." 2. The brief facts of the case are that the assessee, a dealer in paper and paper products, filed his return of income declaring total income of Rs. 1,63,255. The return was processed u/s. 143(1) of the Income Tax Act. The AO found that the assessee had introduced capital of Rs. 8,94,550 during the relevant year. The assessee was asked to file the details of capital so introduced. However, the assessee despite opportunities given to him failed to provide the necessary det....
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....on of appeal. In his letter, the representative had stated as under. (The assessee vide his letter dated 15/2/2010 had endorsed the letter of the representative filed with form No.35) "1. That we were the Authorised Representative in respect of matter concerning Mr. Kunal Surana before the Assessing Officer for the Assessment Year 2006-07 2. That the Assessing Officer had passed order under section 143(3) dated 16th December, 2008 and was duly served on 6th January, 2009. 3. That due to my visit to outside Mumbai on some urgent person work the preparation and submission of appeal was given to my Asssistant Mr. Anand Kanse. 4. However, he had kept these papers in his drawer and failed to take necessary action in the matter. 5. On my resumption of office, he had not informed me about the pendency of submission of appeal due to fear of reprimanded. 6. On receiving the penalty under section 271(1)(c) dated 27th May 2009 (received by our client on 30th May, 2009) it came to my notice about non submission of above appeal. 7. On further inquiry the papers were found in his drawer and left without any action. 8. That a....
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....ismissed and is done so. Apart from dismissal of appeal for the reason of inordinate delay discussed hereinabove, the appeal lacks merit also. On perusal of assessment order, it immensely transpires that inspite of sufficient opportunities, the assessee had not cared to explain the issues/points raised by the AO, which entailed additions. For ease of reference, relevant extract of assessment order of AO as contained in page 1 and 2 is reproduced as under. Page 1 "Capital introduction treated as cash credit u/s. 68 : It is seen from the assessee's proprietary capital account that assessee has introduced capital during the year of Rs. 8,94,550/-. The assessee vide questionnaire were asked to file the details of capital introduction with sources of the same alongwith documentary evidences. The assessee did not produce the details and sources of capital introduced during the year. A reminder letter dt. 17.10.2008 was issued and served on the assessee asking to file these details. There was no compliance from the assessee's side to this reminder letter. A final opportunity letter was given to the assessee vide letter dated 21.11.2008 and case was fixed for hearing on 2....
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....tion of delay was deemed to be allowed by the learned CIT(A). 5. On the other hand, the learned DR has submitted that there cannot be an automatic condonation of delay in such a manner. He submitted that until and unless the application for condonation of delay is not allowed by a speaking order with the application of mind, it cannot be said that the delay was condoned automatically on entertaining the application for additional evidence by the learned CIT(A). 6. We have considered the submissions of the learned representatives of the parties. In our view there is no merit in the contention of the learned AR that on entertaining the application for additional evidence, the delay in preferring the appeal was deemed to be condoned. When a case is barred by limitation, it creates a substantive right in favour of the other party. It cannot be curtailed or taken away by such type of interpretation; rather, an application for condonation of delay is required to be heard on merits and is required to be allowed or disallowed taking into consideration the relevant facts as to whether or not the appellant/applicant was prevented by sufficient cause for not preferring the appeal in tim....
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....r Commissioner in WP No. 9430 of 2006 dated 07.01.2008. Similarly reliance can be placed on another authority of Bombay High Court styled as R.P. Dhanda vs Regional Manager, UCO Bank & .... 2007 (4) Bom CR 321, (2007) IIILLJ 106 Bom. 7. We may further observe that a duty was cast upon the representative of the assessee to bring into the knowledge of the first appellate authority that the appeal preferred by the assessee was time barred and before an application of additional evidence was filed, he should have pressed before the learned CIT(A) for adjudication on the application for condonation of delay. The contention of the learned AR that a right for hearing of the appeal on merits has automatically accrued to the assessee because of the fact that he has succeeded in getting entertained the application for additional evidence by keeping the learned authorities in dark about the pendency of limitation application cannot be appreciated. No one can be allowed to take benefit of his own wrong. Moreover, as observed above, in view of the settled position of law that even entertaining the application for additional evidence pending adjudication on application for condonation of dela....
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....d up the law relating to the requirement of verification clause in the affidavit and the importance of affidavits requiring the same to be strictly confirming to the requirements of Order XIX Rule 3 of the Code of Civil Procedure. The relevant extract of the judgment is reproduced below: "12. The provision of Order XIX of Code of Civil Procedure, deals with affidavit. Rule 3 (1) of Order XIX which deals with matters to which the affidavit shall be confined provides as follows: "Matters to which affidavits shall be confined. - (1) affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove, except on interlocutory applications, on which statements of his belief may be admitted; provided that the grounds thereof are stated." 13. Order XI of the Supreme Court Rules 1966 deals with affidavits. Rule 5 of Order XI is a virtual replica of Order XIX Rule 3 (1). Order XI Rule 5 of the Supreme Court Rules is therefore set out: "Affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove, except on interlocutory applications, on which statements of his belief may be admitted, provided th....
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....n Padmabati Dasi vs. Rasik Lal Dhar 37 Cal 259 and endorse the learned Judges' observations." 17. In Barium Chemicals Limited and another v. Company Law Board and others, AIR 1967 SC 295, another Constitution Bench of this Court upheld the same principle: "The question then is: What were the materials placed by the appellants in support of this case which the respondents had to answer? According to Paragraph 27 of the petition, the proximate cause for the issuance of the order was the discussion that the two friends of the 2nd respondent had with him, the petition which they filed at his instance and the direction which the 2nd respondent gave to respondent No. 7. But these allegations are not grounded on any knowledge but only on reasons to believe. Even for their reasons to believe, the appellants do not disclose any information on which they were founded. No particulars as to the alleged discussion with the 2nd respondent, or of the petition which the said two friends were said to have made, such as its contents, its time or to which authority it was made are forthcoming. It is true that in a case of this kind it would be difficult for a petitioner to have ....
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....ther side to test the veracity and genuineness of the source of information. The same principle also applies to the petitioner in this petition under Article 32 which is based on allegations of political motivation against some political parties in causing alleged interception of his telephone. The absence of such disclosure in the affidavit, which was filed along with the petition, raises a prima facie impression that the writ petition was based on unreliable facts. 20. In case of M/s Sukhwinder Pal Bipan Kumar and others v. State of Punjab and others, [(1982) 1 SCC 31], a three Judge Bench of this Court in dealing with petitions under Article 32 of the Constitution held that under Order XIX Rule 3 of the Code it was incumbent upon the deponent to disclose the nature and source of his knowledge with sufficient particulars. In a case where allegations in the petition are not affirmed, as aforesaid, it cannot be treated as supported by an affidavit as required by law. (See para 12 page 38) 21. The purpose of Rules 5 and 13 of the Supreme Court Rules, set out above, has been explained by this Court in the case of Smt. Savitramma v. Cicil Naronha and another, AIR 198....
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....erved as under: "65. This court wants to make one thing clear i.e. perfunctory and slipshod affidavits which are not consistent either with Order XIX Rule 3 of the CPC or with Order XI Rules 5 and 13 of the Supreme Court Rules should not be entertained by this Court. 66. In fact three Constitution Bench judgments of this Court in Purushottam Jog Naik (supra), Barium Chemicals Ltd. (supra) and A.K.K. Nambiar (supra) and in several other judgments pointed out the importance of filing affidavits following the discipline of the provision in the Code and the said rules. 67. These rules, reiterated by this Court time and again, are aimed at protecting the Court against frivolous litigation must not be diluted or ignored. However, in practice they are frequently flouted by the litigants and often ignored by the Registry of this Court. The instant petition is an illustration of the same. If the rules for affirming affidavit according to Supreme Court were followed, it would have been difficult for the petitioner to file this petition and so much of judicial time would have been saved. This case is not isolated instance. There are innumerable cases which have been....
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....m the function of administration of oath as former has been described under clause (a) of section 8 and later under clause (e) of the said section. The notary while administering oath to the signatory of the affidavit is required to make an endorsement to the effect that the assessee has sworn or affirmed the contents of affidavit before him. The place and date of administration of oath is also required to be mentioned. The procedure to administer the oath and making of endorsement has been described in Chapter XXVII of Maharashtra Civil Court Manual. Rule 510 & 511 of the said manual are relevant, which for the sake of convenience are reproduced here under: 510. "The Officer, authorised to administer oaths shall before certifying the affidavit, him personally or identified before him by a person whom he personally knows, or whose identity is duly established to the satisfaction of the Officer by any of the following documents, namely Passport, Driving License, Voters identity Card, PAN Card, or photo Identity Card issued by State/Central Government. The manner in which the identification is so made shall be certified by the Officer administering the oath" Every O....
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....of the Officer and the certification by the officer of the administration of the oath. Rule 199 and Rule 200 of the Bombay High Court Original Side Rules are also relevant, which for the sake of convenience are reproduced as under: "199. Place of administering oats to be state when oath administered outside Court House.- The officer authorized to administer an oath or affirmation shall state at the foot of the affidavit the place where he has administered the oath or affirmation in the event of the same being administered elsewhere than in the Court House. 200. Affidavit not to be filed unless properly endorsed.- No affidavit shall be filed in the several offices of the Court unless properly endorsed, giving the names of the deponents, the date on which it is sworn, and stating by whom or whose behalf it is filed." Rule 9 & 10 of Chapter III Part II- 'Procedure and Practice Bombay High Court Rules' are also relevant, which for the sake of convenience are reproduced as under: "9. Oath to be administered under Oaths Act . - Oaths and affirmations to be made by a witness or interpreter under section 4 of the Oaths Act, 1969 (Act XLIV of 196....
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....n the authority of Hon'ble Bombay High Court styled as Purushottam vs. Returning Officer and Others- Election Petn. No. 7 of 1990 dated 29.01.1991. The Hon'ble Supreme Court in Krishan Chander Nayar v. Chairman, Central Tractor Organisation, AIR 1962 SC 602 has emphasized the responsibility for making precise and accurate statements in affidavit. In M. Veerabhadra Rao v. Tek Chand, AIR 1985 SC 28 it has been observed that the part or role assigned to the person entitled to administer oath is no less sancrosanct. Hon'ble Supreme Court of India in the case of Dr. (Smt.) Shipra Etc. Etc. vs. Shanti Lal Khoiwal Etc. Etc has observed as under: "Verification by a Notary or any other prescribed authority is a vital act which assures that the election petitioner had affirmed before the notary etc. that the statement containing imputation of corrupt practices was duly and solemnly verified to be correct statement to the best of his knowledge or information as specified in the election petition and the affidavit filed in support thereof; that reinforces the assertions. Thus affirmation before the prescribed authority in the affidavit and supply of its try copy should also contain su....
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....l mistake that the appeal could not be submitted in time. This type of explanation given by the representative of the assessee is vague and evasive and does not constitute sufficient cause as is required to condone the delay under the law of limitation. There is no explanation as to on which date the papers were handed over by the assessee to his representative Shri Sirsalewala and on which date he went out of Mumbai and on which date he resumed office. There is no explanation as to why he did not enquire about the preparation or filing of appeal from his assistant. There is no mention as to whether the assessee ever enquired from his representative about the filing or non-filing, pendency or date of hearing of appeal. Neither any affidavit of the assessee nor any affidavit of the learned representative was produced before the learned CIT(A). The case is of gross negligence and inaction on the part of the assessee as well as his representative. The learned CIT(A) has rightly observed that the said letter is dated 27.06.2008, which was filed along with form no.35 on 05.06.2009, however, the assessment order is dated 16.12.2008 and the appeal has been filed on 05.06.2009 and the s....
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....ed AO to answer his queries. When the assessee did not turn up to answer the enquiries and the assessment was going time barred on 31.12.2008 only then the assessment order was passed by the AO. Again a perusal of the order under appeal reveals that the learned CIT(A) has categorically mentioned that on the stipulated dates of hearing, neither the assessee nor his representative appeared even after adjourning the case for several times. Lastly, the learned representative of the assessee appeared on 16.03.2012 and the case was heard on merits. A perusal of the assessment order as well as the order of the CIT(A) reveals that the assessee and his representative always remained careless and negligent in pursuing their case. The explanation put forward is vague and evasive and does not constitute any sufficient cause for condonation of delay. Faced with somewhat similar situation, Hon'ble Punjab & Harayana High court in the case of Krishan Dev Dhiman vs. Mahesh Bhatia and others [RSA No.3142 of 2006 decided on 08.04.2008] has observed as under: "Even otherwise, the only ground for condonation of delay is contained in paragraph 3 of the application wherein it is stated that the ....
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.... to be callous or negligent. My view is fortified with the following judgments of the Hon'ble Apex Court:- In the case of P.K.RAMACHANDRAN Vs. STATE OF KERALA AND ANOTHER (1997) 7, Supreme Court Cases, 556, wherein it has been held as under:- "The law of limitation may harshly affect a party particular party but it has to be applied with all its rigour when the statute so prescribes and the courts have no power to extend the period of limitation on equitable grounds. The discretion exercised by the High Court was, thus, neither proper nor judicious. The order condoning the delay cannot be sustained. This appeal, therefore, succeeds and the impugned order is set aside. Consequently, the application for condonation of delay filed in the High Court would stand rejected and the miscellaneous first appeal shall stand dismissed as barred by time." In the case of Municipal Corporation of Delhi and others Vs. International Security and Intelligence Agency Ltd. (2004) 3 Supreme Court Cases, 250 the Hon'ble Supreme Court has held as follows:- "21............. It has to be remembered that law of limitation operates with all its rigour and equitable considerations are o....